Overexpression of FGF receptor 3 (FGFR3) is implicated in the development of t(4;14)-positive multiple myeloma. While FGFR3 is frequently overexpressed and/or activated through mutations in bladder cancer, the functional importance of FGFR3 and its potential as a specific therapeutic target in this disease have not been elucidated in vivo. Here we report that inducible knockdown of FGFR3 in human bladder carcinoma cells arrested cell-cycle progression in culture and markedly attenuated tumor progression in xenografted mice. Further, we developed a unique antibody (R3Mab) that inhibited not only WT FGFR3, but also various mutants of the receptor, including disulfide-linked cysteine mutants. Biochemical analysis and 2.1-Å resolution crystallography revealed that R3Mab bound to a specific FGFR3 epitope that simultaneously blocked ligand binding, prevented receptor dimerization, and induced substantial conformational changes in the receptor. R3Mab exerted potent antitumor activity against bladder carcinoma and t(4;14)-positive multiple myeloma xenografts in mice by antagonizing FGFR3 signaling and eliciting antibody-dependent cell-mediated cytotoxicity (ADCC). These studies provide in vivo evidence demonstrating an oncogenic role of FGFR3 in bladder cancer and support antibody-based targeting of FGFR3 in hematologic and epithelial cancers driven by WT or mutant FGFR3.